Excellence: About Culture and Action Bias of Excellent Companies

Moving further "In Search of Excellence", I find that in the beginning it more or less advocates the basic principles of sound management laid down by Peter Drucker in his "Concept of Corporation" and "Principles of Management". The points about a need in people to feel like winners/achievers and the need that the top-line leader/CEO should cultivate a sense of pride and ownership for work/manage culture are fundamentally nicely repackaged Drucker principles. "In Search for Excellence" builds on it by squarely grabbing the user's attention when it matters and giving a number of solid examples to demonstrate its point. This makes it easier to understand and enjoyable. There are two major concepts that I have just read - the importance of culture and the inherent action-bias in excellent companies. What do I think about it?

Drucker advocate a definable, unified task in which a worker can take pride. He also urges the manager to have a vision for the company and the people, that people should not be perpetually tied down to roles form where they can never progress no matter how hard they try. He attributes a lot of labour problems and job dissatisfaction to these two factors. Jim Collins' books demonstrate how (particularly the case of Nucor Steel), if successfully implemented, this can lead to "a culture of discipline" and play a critical role in the rise of the company. I agree with it. "In Search of Excellence" re-brands this mix of strong work-ethic shaped by an able leader as culture by bringing in elements of internal marketing to the mix. It also rightly points out that internal marketing tactics can degenerate into "control games" if not implemented correctly. I am convinced about the usefulness of internal marketing as a potent supplement for a framework of strong work-ethic and able leadership. But leadership is as much about inspiring greatness, so this would also need a careful hiring. As Drucker and Jim Collins both point, hiring the right people is absolutely critical; with hire for attitude and can train for skill (within reasonable limits) being the mantra of good hiring in the long-term. Internal hiring and employee development is essential as well. No wonder a lot of excellent companies tend to hire graduates and then hone them over time; a.k.a. P&G, Goldman Sachs.

Action-bias revolves around the willingness of a company to experiment and innovate. To just do something, anything except standing still. Run around, look busy? I am absolutely sold-out on the idea of experimentation, testing and marketing trials. It makes a lot of sense. This principle when juxtaposed with Jim Collin's "hedge-hog" principle makes a potent mix of sound company strategy: experimenting but keeping your ears to the ground. Too long and expensive "experiments" and one-shot untested projects,as the writers point, are a no-no.

Finally, I feel that only a company that has a clear, hopeful vision based on brutal facts for itself and its people can excel, create value for its employees and enrich the society in which it operates. For me, this book captures certain critical aspects of this belief brilliantly. Let us see what else we learn from this book in days to come.